As well as the yields generated by the protocol strategies, part of the protocol APY comes from a ‘HODL contribution’ from departing protocol users. When users withdraw funds from Vault or sell PWRD, they pay a 0.5% fee as a contribution to the remaining HODLers.
This stabilises the protocol and helps protect users. The longer you keep your funds in the system, the more fees you will earn. All fees are distributed back to users.
Unlike the other yields in the protocol APY which fluctuate depending on the ratio of PWRD TVL to Vault TVL in the system (the utilisation ratio), the HODL contribution is based purely on your share of total protocol TVL.